Rep. Joe Hogan called on Apr. 15 for the Pennsylvania House Finance Committee to move Senate Bill 527 out of committee so the full House can vote on it.
The bill, introduced by Sen. Frank Farry, seeks to ensure that municipalities are reimbursed for wage taxes collected from their residents by the city of Philadelphia. This issue has drawn attention because current tax law under the Sterling Act does not return non-resident wage taxes back to individuals’ home municipalities.
The Sterling Act, enacted in 1932, allows Philadelphia to impose a City Wage Tax on salaries and wages earned within the city. All Philadelphia residents pay this tax regardless of where they work, and non-residents who work in Philadelphia must also pay it. Unlike other jurisdictions in Pennsylvania, none of these non-resident wage taxes are returned to their home communities for local investment.
“On this Tax Day, I am calling on the Finance Committee to hold a vote on Sen. Farry’s legislation, Senate Bill 527,” Hogan said. “Bucks County loses over $11.5 million in tax revenue annually to the Sterling Act. Everywhere else in our Commonwealth these taxes would be sent back to the home community for local investment. Instead, Philadelphia is imposing an unfair burden on all our suburban communities. This is unfair and is just another cost that hits local taxpayers.”
Senate Bill 527 passed the Pennsylvania Senate with a vote of 29-21 and now awaits action in the House Finance Committee.
